Valuing Trademarks
A trademark is a sign which can distinguish goods and services from those of competitors. Trademarks need to be distinctive for the goods and services provided, or need to be recognised as a sign that differentiates goods or services as different from someone else’s. Trademarks, and the associated goodwill, can be important legal rights supporting brands, and in such circumstances a trademark valuation will have similarities with a brand valuation.
Widely adopted trademark valuation approaches
When carrying out a trademark valuation, Intangible Business adopts widely accepted approaches based on a combination of the income, market and cost approaches.
- The income approach uses estimates of future estimated economic benefits or cash flows and discounts them, for the associated time and risks involved, to a present value.
- The market approach uses market based indicators of value. For trademarks this can be transactions involving selling, buying, franchising or licensing IP rights, which are often in practice bundled with other deals.
- There are two general considerations to the cost approach: 1) the historic cost of creating the trademark and the estimated cost; and 2) time that would be required to create an equivalent or replacement trademark.
Focus of Intangible Business
The application of these approaches benefits from Intangible Business’s specific focus on forecasts, with research and analysis of market transactions for different but comparable assets where relevant information is difficult to obtain. Intangible Business adopts a thorough approach based on good knowledge and experience of how to find, analyse and present information in a way which better informs a trademark valuation.
Intangible Business also ensures that the approaches used, and conclusions reached, are commercially balanced, realistic and consistent with analyses required for all the different reasons trademark valuations are required and carried out in practice.
Support to legal services
If trademark value is at stake, it will be a significant issue. Intangible Business is experienced in providing expert independent trademark valuation services for IP management, owners and their legal or other advisers in particular for: dispute resolution; corporate deals; IP management; and supporting other legal services.
Example Cases
